In a decision issued on July 31, 2020, the federal Circuit Court of Appeals for the D.C. Circuit reminded the Federal Labor Relations Authority (FLRA) of the deferential standard of review it must use when considering a party’s request to vacate an arbitration award. National Weather Service Employees Organization v. Federal Labor Relations Authority, Docket No. 19-1163. The Court’s decision checked the FLRA’s recent forays into second-guessing arbitrators’ substantive determinations in the face of well-established law that arbitration awards are final and binding except under the very limited circumstances of an arbitrator failing to base his or her decision on the terms of the contract at issue or the award violates clear public policy, embodied in a statute, regulation or clear case law.
The National Weather Service Employees Organization (Union) represents non-management employees at the National Weather Service (NWS). The Union sought a court order nullifying the FLRA’s decision to vacate an arbitration award,as part of a petition addressing additional issues concerning the FLRA’s actions. The FLRA had vacated an award issued by Laurence Evans (a member of the National Academy of Arbitrators) in which Evans had found that the NWS had breached the collective bargaining agreement (CBA) it has with the Union when it terminated the CBA without meeting the conditions necessary to do so.
In granting the Union’s request to reverse the FLRA’s vacatur of the award, the D.C. Circuit Court explained that the FLRA had not applied the correct legally required standard for the FLRA’s review of arbitration awards. The Court stated:
When reviewing an arbitrator’s award, the Authority is required to apply a similarly deferential standard of review to that a federal court uses in private-sector labor-management issues. 5 U.S.C. § 7122(a)(2); see Am. Fed’n Gov’t Emps., Council 220, 54 F.L.R.A. 156, 159 (1998). The Authority may vacate an arbitrator’s award only when it is “contrary to any law, rule, or regulation,” or “on other grounds similar to those applied by Federal courts in private sector labor-management relations.” 5 U.S.C. § 7122(a). “Congress thus appears to have intended that in the area of arbitral awards the Authority would play in federal labor relations the role assigned to district courts in private sector labor law.” Griffith v. FLRA, 842 F.2d 487, 491 (D.C. Cir. 1988). The Authority has acknowledged that it “has consistently reviewed arbitral awards under the deferential standards adopted by the Federal courts.” Social Security Admin., 63 F.L.R.A. 691, 692 (2009).
Consequently, the Authority reviews an arbitrator’s decision highly deferentially, only to ensure that the arbitrator’s award “draws its essence from the collective bargaining agreement.” United Steelworkers of Am. v. Enterprise Wheel & Car Corp., 363 U.S. 593, 597 (1960). “[A]s long as the arbitrator is even arguably construing or applying the contract and acting within the scope of his authority,” the Authority may not reverse the arbitrator’s award even if it is “convinced he committed serious error.” United Paperworkers Int’l Union v. Misco, Inc., 484 U.S. 29, 38 (1987).
In the NWS case, instead of determining whether or not the arbitrator was arguably construing the contract, the FLRA instead conducted a substantive review of the arbitrator’s reasoning and then decided that it disagreed with the result of the arbitrator’s analysis. In doing so, “the Authority failed to apply the correct standard of review . . . [and] acted contrary to law,” the Court held.